The opposing groups for the next generation of DVDs are talking about merging the two standards, according to a report in Japanese newspaper Nihon Keizai Shimbun.

The battle over DVD formats has been raging between Sony's Blu-ray and Toshiba's HD DVD. The manufacturers have now engaged in talks seeking a compromise.

If the pair reach an agreement, they still need to gain support from the companies backing each standard. Having a single standard for future DVDs will prevent confusion among consumers over which player to buy for a high definition DVD set.

With a storage capacity of up to 50GB per disc for Blu-ray, the standard is considered more advanced than its competitor.

HD DVD might be limited to 30GB, but it is already on the market and is slightly cheaper.